HOW BANK DA(DEARNESS ALLOWANCE) IS CALCULATED (EXPLANATION)

BANK DA IS CALCULATED ON CONSUMER PRICE INDEX(CPI) BASED ON YEAR 1960.

- Labour Department will release Consumer Price Index (No.) every month ,based on year 2001.

Conversion factor to year 2001  is  Index No .X 4.63 X 4.93

- BANK DA IS CALCULATED EVERY QUARTER.

January, February, March is one quarter. Likewise there are four quarters in a year. So, BANK DA changes four times in a year as opposed to two times in central /state government jobs.

Difference between average CPI over average of previous quarter is called increase in Dearness Allowance.


- For every increase of 4 points, one slab at the rate of 0.15% is given as Dearness Allowance in banks.

- Since every month’s Consumer Price Index is announced by the labour department on the last day of next month, Dearness Allowance is given effect on the subsequent month, that is, two months later.

EXAMPLE: for Dearness Allowance in Feb 2012:

APR   MAY  JUNE  JULY  AUG  SEP      OCT NOV DEC 2011
---------------------------------------------------------------------------
  186      187    189      193      194     197       198    199     197
--------------------------------------------------------------------------- 
Average of Oct,Nov,Dec 2011                                                =198
On conversion =Average O N D 2011(198X4.93X4.63)        = 4519.53 
D.A already paid for Nov. 2011(i.e average of Jul,Aug,Sep)= 401 slabs = 401X4+2836  = 4440.00
 (2836 is already merged point in 9th BIPARTITE)

Increase                                                                                    = 79.53    
Slabs                                                                                         =79.53/4=19.88=19

(ONLY WHOLE NUMBERS ARE TAKEN.
DECIMALS ADJUSTED IN THE NEXT MONTH )

HENCE INCREASE FOR Feb 2012 is 19x0.15=2.85% of (B.P+SPL.ALLOW.+PQP) 
Total D.A for Feb,Mar,Apr 2012=401+19=420 slabs=60.15%+2.85%=63%.

Quarterly DA HISTORY for Bank Employees from 2008:

Month                                           SLABS                   %

Nov,Dec,Jan     2008
40                        6.00
Feb,Mar,Apr    2008
55                        8.25 
May,Jun,July   2008
63                        9.45          
Aug,Sep,Oct     2008
84                      12.60  
Nov,Dec,Jan     2009
116                   17.40
Feb,Mar,Apr    2009
133                   19.95 
May,Jun,July   2009
135                   20.25   
Aug,Sep,Oct     2009
154                   23.10
Nov,Dec,Jan     2010
213                   31.95
Feb,Mar,Apr    2010
245                   36.75
May,June,July  2010
264                   39.60
Aug,Sep,Oct     2010
272                   40.80
Nov,Dec,Jan     2011
308                   46.20
Feb,Mar,Apr    2011
333                   49.95
May,Jun,July   2011
352                   52.80
Aug,Sep,Oct     2011
360                   54.00
Nov,Dec,Jan     2012
401                   60.15
Feb,Mar,Apr    2012
420                   63.00
May,June,July  2012
428                   64.20
Aug,Sep,Oct     2012
468                   70.20
Nov,Dec.Jan     2013
510                   76.50
Feb,Mar,Apr  2013                         
535                   80.25
May,June,Jul  2013
561                   84.15
Aug,Sep,Oct  2013
593                   88.95
Nov,Dec,Jan  2014
641                   96.15
Feb, Mar, Apr 2014
666                  99.60
May,June,July 2014
650                  97.50
Aug,Sep,Oct 2014
683                 102.45%
Nov,Dec 2014&Jan 2015
732                 109.80%
Feb,Mar,April 2015
May, June, July 2015
734                 110.10%
738                 110.70%








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